Crypto Accountant in Petach Tikva

If you are engaged in crypto — whether it's a full-scale business in the field or a personal investment — you know that reporting to the tax authorities is one of the most complex issues in Israel. Regulation in the field of digital currencies is still in the process of crystallization, and what is clear is that the tax authorities require full reporting of all crypto activity — from mining operations, through buying and selling transactions, to long-term holdings.

Ben Or Kok Certified Public Accountants in Petach Tikva specializes in assisting freelancers and business owners in the digital field, including digital currencies. We understand the complexities of crypto reporting, the calculations of profit and loss in various transactions, and the evolving requirements of the tax authorities. Our goal is to ensure that your reporting is accurate, complete, and lawful — and that you pay only the tax you are required to pay.

Who needs a CPA in the crypto field?

Crypto reporting is a mandatory obligation for anyone engaged in digital currency business in Israel. This includes:

• Freelancers and companies — If crypto activity is your actual business, you need an annual report, bookkeeping, and proper calculation of income tax.
• Private investors — Even if you engage in crypto as an investment and not as a business, you still have an obligation to report to the tax authorities on gains and losses.
• Miners and smart contracts — If you operate mining or receive income from smart contracts (staking, yield farming), this is complex reporting that requires specialized knowledge.
• New immigrants and residents abroad — If you have crypto activity in Israel or hold crypto assets abroad, you may need advanced international reporting.

What is common to all these cases: the tax authorities expect accurate reporting and clear documentation. Failure to report or partial reporting may result in an audit, penalties, and interest.

What Exactly Needs to Be Reported on Crypto?

Reporting on digital currencies involves multiple layers. First, every transaction — purchase, sale, exchange between currencies — must be documented precisely. The tax authority requires knowing the date, quantity, price in shekels at the time of transaction, and the profit or loss generated.

If you hold crypto for a long period (over a year), you still need to report the value at the end of the tax year. If you process crypto (mining or receiving income from smart contracts), the value at time of receipt is considered income. And if you hold futures contracts or options on crypto, that is another layer of reporting.

What complicates everything: crypto prices change every second. You need to know the value in shekels for each transaction precisely, typically according to the exchange rate at the time of transaction. This requires technical tools and knowledge of documentation from the exchanges where you trade.

The Reporting Process — Step by Step

When you come to us with crypto, here is how we work:

1. Data Collection — We request from you the complete history of your crypto transactions. This includes certificates from exchanges (Coinbase, Kraken, Binance, etc.), and a full log of every purchase, sale, exchange and income receipt.
2. Conversion to Shekels — We calculate the exchange rates at the time of each transaction and process the data with our tools. This includes purchase price, sale price, and calculation of accurate profit or loss.
3. Calculation of income tax — According to the type of activity (business or investment), we calculate your tax liability. If it is a business, the profit is business income. If it is an investment, it is typically capital gains.
4. Filing Annual Report — If you engage in crypto as a business, we file a complete annual report with the tax authority including all details. If you are an investor, we report profits on your income tax return.
5. Future tax planning — We design a strategy for the coming year to help you understand your tax liability and plan accordingly.

Common Mistakes in Crypto Reporting — and How to Avoid Them

In recent years, we have seen many reporting mistakes in crypto. Some are merely costly, while others can lead to tax authority audits.

Mistake 1: Failure to report small transactions. People think that small transactions "don't matter." This is incorrect. The tax authority can audit all your exchange transactions, and if there is a discrepancy between what you reported and what the exchange reported, that is a problem. We report every transaction, including the small ones.

Mistake 2: Using incorrect exchange rates. Some people use the daily closing rate or an average rate. This is not always correct. The requirement is the rate at the time of transaction. We use accurate data directly from the exchanges themselves.

Mistake 3: Failure to distinguish between business and investment. If you trade crypto regularly and actively, it is typically considered a business. If you only hold crypto, it is an investment. Reporting differs between the two, and there are different tax implications. We help you understand which category you fall into.

Mistake 4: Forgetting expenses. If you engage in crypto as a business, you have expenses: exchange fees, electricity (if you mine), equipment, consulting fees, etc. These expenses reduce your taxable profit. We help you document them properly.

Mistake 5: Failure to report crypto held abroad. If you have crypto abroad, you must report it to the tax authority in an international report. This is not always clear, but it is an obligation.

Who Should Contact a Crypto Accountant?

If you are in Petach Tikva or the surrounding area (Ramat Gan, Hod HaSharon, Rosh HaAyin) and are involved in crypto, you should contact us if:

• You have opened a business or company in the crypto field or digital currencies.
• You trade crypto regularly and require accurate reporting.
• You sell crypto or receive income from smart contracts.
• You are concerned that your reporting to date has been incomplete or inaccurate.
• You are about to file an annual tax return and are unsure how to report crypto.
• You are new immigrants bringing crypto to Israel and require international consulting.

Reporting on crypto is complex, and it is better to handle it with someone who knows the way. The Israeli Tax Authority is becoming increasingly strict in this field, and proper reporting now saves problems in the future.